“Build it, and he will come,” says Kevin Costner in the movie Field of Dreams. And what goes for corn fields and baseball goes for online marketplaces and returned and excess inventory. Case in point: it started with one major retailer partnering with B-Stock on an online marketplace to start building a large buyer base for used and trade-in phones. GameStop opened its branded auction marketplace for trade-in cell phones in 2013 increasing its buyer base by 1700%. From there, the addition of new mobile marketplaces steadily multiplied the number of new buyers, repeat buyers, and even created power buyers in the category. Power buyers often purchase across dozens of marketplaces and will spend millions of dollars a year on used, returned, and trade-in inventory.
This multiplying of buyers every time a new marketplace opens is known as the network effect. Here’s how it works: Each red dot is a marketplace, in this case both retailers had their own buyer base. At some point, the network effect kicked in and they began to share many of the same buyers.
Emergence of Power Buyers
Here you can see power buyers beginning to emerge. Power buyers are identified by a thick, bold line; the thicker the line, the more transactions they completed. A couple of power buyers are exclusive to a single marketplace, buying only from that one source, as shown by the blue dot.
As each new retailer marketplace joins the network, the buyer ecosystem grows.
By joining the B-Stock marketplace network, companies selling overstock, returned, and trade-in quality phones have access to a global buyer base for secondary market mobile devices.
And it’s not just limited to our mobile clients. The network effect works similarly across all categories: apparel, appliances, home + garden, consumer packaged goods, etc. If you’ve got returned or excess inventory to sell, we’ve got a buyer network for it.
To learn more on how our marketplace solution works, contact us today to schedule a demo.
The Q1 Grade A Award winners have been announced and we couldn’t be more excited to spotlight them! The award spotlights outstanding performance by individuals who 1) embody the B-Stock values, 2) are collaborative, dedicated team members, and 3) make bold attempts and innovate.
Without further ado, here are this quarter’s winners and their nominations as submitted by peers from across the company!
Layth Ibraheem Technology Engineer
What his nominators wrote:
Layth has shown exceptional drive and commitment to B-Stock’s Core Values, most prominently in patience and persistence, behavior, actions and attitude, intelligence and curiosity, passion for building something great, and humor. Layth is a team player who is clearly invested in the success of B-Stock as a company and his immediate team members. He is always willing to lend a helping hand as well as offer words of encouragement when you succeed. He cares about your growth as an engineer and wants to see you progress. He also isn’t afraid to lighten the mood and crack a few jokes, which is much appreciated and a great reminder to not take yourself too seriously. Layth leaves me motivated to become a better engineer every day I work with him, which is why I think he is the perfect choice for this award.
Honesty, passion, humor, teamwork, and respect: Layth exemplies every single one of these core values. He is not only passionate about the work that he does as an engineer, but he is a leader in his willingness to help others, both on his team as well as on other teams. When given a problem to solve, Layth will not only find and implement a solution, he will then go one step further in order to improve the quality of life for both external customers and internal teams. His automations work for the Finance team magnified his drive and initiative to me.
Layth has been a mentor to me, and has pushed me outside my comfort zone, which has enabled me to become a stronger engineer. His feedback on my code, or my approach to a problem, is always extremely candid, yet very respectful. I can always trust that Layth holds me to the highest standard. Layth is also a lot of fun to be around, and even when the team is faced with a challenge, he’s able to bring his sense of humor to the table and can bring a smile to anyone’s face.
Layth’s personality helps define the integrity, entrepreneurial spirit, well-intended, and good-natured culture of our company.
Tim Dupuis Account Management
What his nominators wrote:
I have worked with Tim across multiple clients and prospects. His consistent approach to excellence is his greatest asset and a huge value add to the entire B-Stock Team. This current quarter he is onboarding a client, building custom demos for my prospects, and winning Ping Pong Tournaments! Tim is truly covering all the bases! One specific example, Tim knows how to leverage data to help ensure the success of pilot marketplaces.
I’m nominating Tim Dupuis for the Q1 2019 Grade A Award based on: his high level of professionalism and his ability to learn about the Fashion vertical business strategies; Tim’s solid partnerships with myself, Listings, CS, Finance, Marketing and most importantly the fashion clients during implementation and pilot; his proven track record to strategically lead the fashion vertical marketplaces (and all marketplaces to be honest) during the implementation and pilot phases by communicating the best auction strategies to ensure successful launches.
Tim has excellent communication skills and has always been there for me to provide technical guidance and support whenever I needed it. He’s confident yet humble, and never makes assumptions. His presentation style and demeanor on a business call or during an on-site meeting is polished and friendly, he demonstrates excellent listening skills, he’s collaborative and always provides valuable information for our clients.
The Fashion vertical can be challenging to learn due to the numerous attributes that impact GMV and recovery: brands, seasonality, inventory, assortment, holidays, buying patterns, etc. Tim often mentions my fashion expertise during meetings and how he’ll partner with me to ensure the lotting for the initial rounds are created to maximize the recovery. He keeps the Listings Business partners involved throughout the process as well. Tim really understands teamwork and is viewed as a role model not only from the Implementation team, but the entire Boston office. He consistently goes above and beyond his responsibilities to ensure that we all WIN in this amazing organization. As one of the first Grade A Award winners, I can’t think of anyone who deserves it more than Tim.
Tim is an amazing business partner who demonstrates daily with his attitude and excellent communication just how much he truly understands that the success of one department IS the success of another and that we are truly TEAM B-Stock. He works diligently with all departments to ensure we are all “pulling in the same direction” to achieve what is best for our clients, our buyers, and our company. If he is made aware of a pain point for another Team—he actively engages to understand the problem and see if there is anything he can do to help; further demonstrating that he understands that though we may all have different job functions—we are all dependent on one another and working together is the way we succeed.
Eunice Lee Product Manager
What her nominator wrote:
From the perspective of the Boston office and Client Services team, Eunice has been nothing short of spectacular. She has gotten deep in the weeds to become a subject matter expert in areas to help out the entire team. When Eunice sees a problem to solve, she always comes back with a solution that is better than what anyone else imagined. Her recent work in Tableau has enabled account managers to save dozens of hours of time, while conducting more complete and clear analysis, in ways we couldn’t do before. I appreciate the open mindedness, patience, and teamwork shown by Eunice and all that she has done to help our team(s) be successful.
B-Stock’s core values are represented by each of these employees. Every quarter we’ll celebrate three new employees recognized by their peers for their great teamwork. If you want to join this dynamic team of account managers, developers, product marketers and more, please check our careers page for current openings.
Consumer Electronics is a hot category to source across B-Stock’s marketplaces. Your customers will love finding great deals on brand-name tech gadgets and must-have accessories. Liquidation Consumer Electronics items are sold in a variety of product conditions including new, refurbished, returned, non-functioning, open box, and end of life. In fact, over one million consumer electronic devices are sold annually across B-Stock’s marketplaces. That’s a lot of inventory! But before you begin bidding, let’s discuss some of the best practices and benefits of sourcing consumer electronics; along with some tricks of the trade!
Around 20% of consumer electronics purchases get returned to the retailer or manufacturer and the reasons may surprise you! The top two causes for returns include:
The item is just too difficult to figure out how to use. Rather than utilizing customer support or reading the manual, many consumers will just give up and take the item back– even though there is nothing wrong with it.
Lack of Problem-Solving
Essentially, the product doesn’t solve the problem the customer is hoping it would. Perhaps purchasing an activity tracker didn’t result in weight loss, so the consumer decides it isn’t worth it any longer.
Benefits for Business Buyers
Given the two most popular reasons for returned CE items, this offers up several key benefits for small business buyers and resellers. Let’s take a look at how…
Since neither of the top two reasons for returned consumer electronic items includes functionality…this is good news. In fact, a majority of returned items are in perfect working condition! The fact that there is a high chance that the product you’re bidding on works great is a huge benefit for small business buyers and resellers.
Consumer electronics are in-demand inventory. The fact that there are so many smartwatches or activity trackers (for example) available, show the popularity of the product. Since a lot of people are purchasing these items, this allows buyers and resellers to move inventory fairly quickly. Historically, video games, gaming consoles, and Apple products are sought-after items that generate higher pricing.
Things to Consider
Since we looked at the benefits of buying returned consumer electronics, it’s only wise to look at potential drawbacks you could face as a small business buyer or reseller.
Given the fast-changing nature of consumer electronics, make sure any item you’re reselling is up to date with the most current version. If you don’t feel technologically savvy enough to do this yourself, you may have to hire someone dedicated to this.
This is a critically important step in reselling returned or refurbished consumer electronics. Any product that has a storage device (tablets, smartwatches, activity trackers, etc.) must be wiped of any personal information or sensitive data from the previous user. Fortunately, the inventory you buy on B-Stock has likely already been wiped by the retailer or manufacturer (unless you are an R2 Certified buyer– learn more by reading our post R2 Certifications and Why They Matter), but it is still important to double check each item before reselling to protect your own business reputation.
Best Practices for Buying Consumer Electronics on B-Stock
Whether you’re a new buyer or an experienced CE small business, we’ve compiled some of our top pro tips for buying and reselling returned consumer electronics.
Before you bid on that lot of consumer electronics, look up pricing on the current versions of those items. Make sure that even newer versions haven’t had a significant price drop due to a brand new model release. It’s important to do your research! Remember, you will need a good amount of discount to successfully resell the items.
If you’re just starting out buying and reselling consumer electronics, we recommend buying small lots to start. Additionally, purchase inventory that usually sells quickly. For example, start with Bose speakers, Beats by Dre headphones, laptops, iPads and smartwatches.
Follow the rules
Be aware of any particular reselling rules from the retailer/manufacturer you’re purchasing from. In some cases, retailers or manufacturers will not allow you to resell the inventory in certain forums, online sites, geographic locations, etc. You can find these specific restrictions in an auction’s Terms & Conditions section (usually located at the bottom of the page).
Whether it’s a warranty, great customer support, a 30-day money back guarantee…show your customers you care! This will establish you as a reputable and responsible business and bring back good customers.
A good rule of thumb to remember is, the lower the original value of the good, the harder it is to resell that item as used or refurbished. For example, a wireless keyboard with an MSRP of $19.99, that you’re selling for $10, will be harder to move (and less popular) compared to a $500 laptop that you’re selling for $250.
In other words, the deeper the discount (in dollars) you offer, the easier it is to make your money back and move the item quickly.
B-Stock is heading to store2019 in Toronto May 28 & 29 where the most influential leaders in retail will meet and discuss opportunities targeted to the unique needs of the dynamic Canadian retail industry.
If you’re planning to attend the show we’d like to invite you to our panel: Don’t Fear Customer Returns May 28th 11:20am to 12:05pm
The panel, moderated by B-Stock’s Paul Busch, will include a panel of experts from Lowe’s Canada, The Source, and HBC. It will involve a discussion on how to:
How are returns processed?
What are the key metrics for reverse logistics?
What do you do with the returned inventory?
Discover solutions, best practices and ideas on reverse logistics strategies
If you haven’t scheduled a time to meet, we’d like to extend an invite to Booth #226 where you can say hello to the team and learn how B-Stock’s auction-based liquidation solution is currently generating 30%+ higher recovery for nine of the top 10 U.S. retailers.
For more information on how B-Stock can build a technology based and data-driven solution for your returned, overstock or excess inventory, please contact us.
As part of its restructuring efforts, a leading integrated retailer needed to consolidate three returns warehouses to one. With pressure mounting to move liquidation inventory fast while protecting recovery, the retailer’s reverse logistics team turned to B-Stock with the following goals:
Generate a consistent flow of inventory and cash
Reduce the inventory sales cycle
Increase demand for specific product categories: shoes, electronics, pantry, etc.
Help support returns-center consolidation goals
B-Stock launched a technology-driven, private B2B liquidation marketplace platform, enabling thousands of approved business buyers—interested in products across all categories—to bid directly on merchandise via online auctions. This immediately eliminated dependence on a small group of buyers. What’s more, the auctions generated competition, driving up pricing. Auction and demand-generation strategies were applied to help drive demand.
Since launching its B2B marketplace, the retailer increased its buyer base from around 25 to over 8,000, including adding thousands of category-specific buyers via targeted demand generation campaigns. The automated auction process allowed the retailer to sell large volumes of merchandise quickly and effectively: the inventory cycle was reduced from ~40 days to ~17 and the warehouses are no longer over capacity.
Weekly reporting sessions with B-Stock’s account managers to review data and marketplace activity have allowed the retailer to adjust to the ever-changing secondary market landscape and implement new strategies.
B-Stock’s European team is heading to Supply Chain Industry Week in Berlin May 20-22. SCi Week 2019 brings three key supply chain industries together under one roof: Retail + FMCG, Discrete Manufacturing, and Process Manufacturing to explore supply chain best practices.
B-Stock’s EMEA Director, Ben Whitaker, will be hosting a presentation on how the world’s leading retailers are applying auction strategies and data to boost recovery and efficiency when it comes to their returns programmes.
Presentation: Why the world’s leading retailers are applying auction strategies to their returns programmes Hosted by: Ben Whitaker When: Monday, May 20 Time: Noon
If you’re attending the show, please stop by booth #6, we’d be happy to chat with you about B-Stock’s marketplace solution for returned, excess, and other problem stock. Via the marketplace you can:
Quickly turn your problem stock into cash
Sell directly to targeted business buyers across Europe
Sell any type of product, condition or quantity; from pallets to truckloads
This article summarizes a recent research report on the state of retail omnichannel experiences. At the most basic level, when a retailer provides an omnichannel experience for customers, it means the customer should expect the same inventory, pricing, and returns policy regardless if they make a purchase online or in a store. But not all retailers take this grand view of what omnichannel means to them. Instead, some retailers are taking a pick-and-choose approach to omnichannel and implementing certain strategies, including:
Replacing traditional cash registers for a cashless mobile point of sale (POS) system
Empowering associates with mobile devices for inventory, product, and customer data purposes
Buy online pickup in-store
Buy online return in-store
Ship from store to home
Same day shipping
Creating customer friendly fulfillment options like endless aisle—enabling customers in your store to virtually browse or order a wide range of products that are either out of stock or not sold in-store and have them shipped to the store or to the home
Consumer expectations are driving this need for omnichannel strategies: they want an always-on, seamless, consistent, and personalized shopping experience across all channels and touchpoints. The 2018 – 2019 Omnichannel Leadership Report published by NewStore evaluated current omnichannel capabilities and maturation of 150 apparel, lifestyle, and luxury brands. The focus of the research was to evaluate core offerings and omnichannel capabilities and how well they support the modern shopper’s customer journey. The report dove deep on Search & Discover, Personalization & Engagement, Path to Purchase & Fulfillment along with a quick look at the top five retailers implementing omnichannel tactics.
Omnichannel Done Right
Companies that are highly successful at implementing these omnichannel strategies include: Diesel, Nike, Coach, Aritzia, and Kate Spade; all of which are various types of apparel retailers.
Based on research findings, Diesel led this group of top retailers by fully integrating their systems. Diesel is the only brand that can provide international inventory visibility; allowing shoppers to shop any location around the world.
Nike’s in-store experience now includes store associates armed with mobile devices so they can quickly look up product or customer information, along with shared cart capabilities and fulfillment from other stores.
Coach’s associates have iPads they can use to access customer information, place endless aisle orders, and process mobile payments.
Aritzia’s style advisors ranked high in the research due to their ability to pull up and leverage customer data instantaneously while helping them shop in-store or to follow up after they left.
Associates at Kate Spade also have mobile devices that they use to order out of stock items or look up inventory. Kate Spade also allows customers to take advantage of convenient fulfillment capabilities like click and collect.
Search & Discover Omnichannel Strategy
The idea behind Search & Discover is the ability for a retailer to provide instant visibility of product and inventory information for both in-store and online purchases. This ability should also extend to store associates; however, the report shows that 55% of store associates can’t access their own store’s inventory and 61% of store associates can’t access inventory at another store location.
Provide customers in-store devices
A solution to this problem is to provide customers a device in-store that displays wider product selections, remote inventory, as well as online-only offers. Currently, only a third of retailers offer these customer-facing mobile devices in their stores.
Improved product recommendations
Another successful tactic retailers are employing is to show related products and product pairings to customers as they search online. Doing so provides more personalized, tailored content to customers, which directly impacts the bottom line, beefs up online shopping carts, and increases average order size, according to the report.
Personalization & Engagement Omnichannel Strategy
Engaging with customers provides a means for a retailer to create long-term relationships. Retailers who are winning big with personalization & engagement are leveraging mobile technology and customer profile data to create intimate interactions… leading to more relevant and engaging shopping experiences. The report found that 60% of brands provide store associates with mobile devices in-store to help with sales.
The report states there is a direct correlation between total sales, average order size, and repeat purchase. However, retailers need to find a way to provide this data to in-store associates during scheduled in-store visits and consultations. Retailers need to arm their associates with customer’s omnichannel order history and data to help increase customer loyalty. The report also states that 60% of sales generated through an appointment can generate up to a 20% increase in upselling; but only 9% of brands surveyed enable in-store appointment scheduling.
Visible Purchase History
Unfortunately, less than a third of store associates have access to an omnichannel purchase history while they’re with the customer on the shop floor. An associates inability to access this information stops them from delivering a rich, personalized shopping experience for their customers.
Visible Wish Lists
To further complicate matters, the report states that only 7% of all store associates can see a customer’s wish list during an in-store appointment. If associates were granted access to their customer’s wish lists during their visit, they could make informed, relevant recommendations to the shopper.
Path to Purchase & Fulfillment Omnichannel Strategy
One of the most common approaches to omnichannel strategy by retailers is to provide choices on how a customer can receive their purchase. An important topic for retailers is to remove any friction from the payment process and to provide multiple fulfillment options and delivery methods. The report shows that 26% of brands offer buy-online-pickup-in-store options while 29% of brands offer buy-online-return-in-store options.
B-Stock provides retailers a private, online marketplace to auction off returned and overstock merchandise, on an ongoing basis, to a large network of business buyers from across the country. By selling via their own B2B liquidation marketplace to a larger buyer group, retailers can increase recovery rates and keep warehouses from hitting capacity.
Longer days, family vacations, and time spent outdoors all mean one thing…summer is coming! So, as a small business and/or reseller, it’s important to think ahead so you’re prepared for what your customers will be shopping for in the coming months. Fortunately, you’ve come to the right place. You can find in-demand inventory from nine of the top 10 U.S retailers right here on B-Stock. From summer sandals to sunscreen, we’ll show you the top items and categories to source for summer 2019!
Dive into Summer Sourcing: Home & Garden
Whether it’s lighter, brighter home decor or backyard living comforts, source what your customers want this summer. Get your backyard ready with inventory like patio furniture, sun shades, and grill accessories from top home and garden retailers. You can find interior and exterior goods on our marketplaces like The Home Depot, Lowe’s Liquidation or Costco Wholesale Liquidation Auctions.
Health & Beauty
Summer is the time to slather on the sunscreen and the self-tanners. Get your customers’ faces and bodies prepped for sunny days outside with health and beauty essentials. Shop marketplaces like Target Auction Liquidations and Walgreen’s for top brand names in summer skincare and beauty must-haves.
From stylish sandals to tanks and tees in trendy neon or tie-dye, summer season’s fashion must-haves (at a discount) are always appealing to shoppers. Keep your customers looks current with on-point apparel from B-Stock marketplaces: Macy’s, HSN Liquidation, Hudson’s Bay Liquidation Auctions, and more.
Toys, Kids & Baby
With school not in session, it’s all about finding creative ways to keep kids engaged and entertained this summer- both inside and out! Toys and games can be a parent’s sanity-saver over the summer. Check out the auction lots of kid-friendly activities, toys and games on marketplaces like Walmart Liquidation Auctions, B-Stock Supply, and others.
With plenty of 4th of July and Labor Day parties planned, party-focused and holiday decor is always a big hit! Items that make entertaining easy and stars and stripes-themed decorations will get bought up in a hurry. Source summer, seasonal party-themed inventory on marketplaces like Target Liquidation Auctions, Walgreen’s, or Wayfair.com Liquidation Auctions.
For the campers who could use some new camp chairs to the kids you can’t keep out of the pool, stocking specific summer activity gear is a solid sourcing strategy. Pool floats, kayaks, coolers, and cooking supplies, you can find all of these summer activity must-haves on marketplaces like Sam’s Club, Costco Wholesale Liquidation Auctions, or Target Auction Liquidations.
Sourcing summer essentials now will heat up sales for you in the coming months. Just think about the items you’d be on the hunt for, and chances are, your customers will be too. Happy sourcing!
As graduation day is upon us, the class of 2019 is gearing up to celebrate. According to a survey conducted by the National Retail Federation, the average person will spend $102.51 on graduation gifts. In fact, total spending is expected to reach $5.2 billion!
While cash is still king, there are other categories small business and resellers are stocking up on this year just for graduation day. Let’s take a closer look at the top gifts and categories for new grads.
Top Graduation GiftsKitchen Gadgets
Maybe the new graduate is upgrading apartments or moving out of his or her parent’s house for the first time. Either way, kitchen must-haves always make good gifts for new grads.
**Pro-tip** When it comes to marketing your inventory, cash in on the graduation season! Using some of these top gift ideas, promote specific items you have directly to the Class of 2019. Create graduation gift bundles, special offers for new grads, or even free or add-on items in your marketing efforts.
Now is a great time to enter the secondary market as a repair technician, especially if you love tinkering with old computers and newer cell phones. In this article, we’ll cover many of the biggest topics facing consumer electronics and mobile phone refurbishers and how R2 is shaping the industry. This should serve as a good introduction on the terms and methods used to resell computer and mobile products. You’ll also learn how and why refurbishers buy and sell to and from one another, and how networking plays an essential role. Finally, we’ll talk about operating systems and what Microsoft considers pirated software.
If you’re brand new to repair and refurb work and want to get into the business, looking for a training class on how to refurbish computers could prove difficult. A Google search on ‘computer refurbishment training’ will return search results, but most of them are either for refurbishment companies or courses that you can take online. Computer refurbishment is not normally a class you can take at a local school and it might be very difficult to find an independent training class. There are online courses available, but they won’t give you hands-on experience. The good news is that a large, registered refurbisher network does exist, so it’s usually not too hard to find a refurbisher company in any major area; and a lot of them offer on-the-job (OJT) training. Also, many refurbishers are nonprofits and some of them have volunteer programs that will provide training.
One example of OJT is learning how to image computers in bulk. There are software packages available for both Linux and Microsoft that allow a refurbisher to image computers in bulk, meaning, they can install operating systems (OS) on many computers at once. For those interested in technology, this is a great way to get started with the basics.
Sourcing secondary market consumer electronics
If you already work as a refurbisher, or you’re ramping up your business, then you need to source product, that is, you need to find inventory for your business. To do so, networking at conferences becomes essential to source product. For example, B-Stock has been a sponsor of the Electronics Reuse Conference for many years now; this is where a lot of business happens face-to-face. During these conferences, many times people will walk around with Excel sheets to show what product they have available. As a whole, the industry is not yet fully automated and many players still work off spreadsheets to collect bids for their inventory.
Usually, refurbishers tend to buy in bulk. For instance, if a refurbisher has an opportunity to purchase 10 or even 100 broken iPhone 6s, they will buy those, fix them, and then sell them individually to customers in their stores. In many cases, refurbishers operate out of brick-and-mortar stores where they also offer repair services such as replacing broken screens.
In the industry, refurbishers specialize in certain skills and will repair products that fall within their scope. They in turn resell the repaired products to end-users (as compared to selling to another refurbisher). In most cases though, refurbishers tend to buy bulk lots (a ‘lot’ is a group of inventory that is available for sale) from each other where the product still needs some sort of repair or refurbish work. For example, if a refurbisher has an opportunity to buy 100 iPhone 7s with broken screens, but they don’t do screen repair, but they know someone who does, then they will buy the lot of iPhone 7s, turn around and sell them to the refurbisher that does screen work, and they in turn fix the screens and then finally resell the repaired phone to an end-user (an end-user is the person or persons who will actually use the equipment).
Buying and selling to and from each other
Most of the people that attend conferences are all buyers and sellers from and to each other. For example, let’s say a computer refurbisher has 100 ThinkPad laptops, but he may not have the time, the space, or the market to sell them as refurbished. He might know how to refurbish the laptops, but he might not have time to do the work. In that case, he might choose to sell those ThinkPads in bulk to another refurbisher who does have time to do the work. Selling large lots of inventory like this also helps refurbishers clear space from their warehouse while at the same time they can make a profit.
For some refurbishers, this is the only type of selling they do. Sarah Cade from the Electronics Reuse Conference explains it this way, “There are cases where some companies have certain expertise and they don’t do all types of refurbishing; in that case, it’s better to resell to another refurbisher who does have that specialty. Or, they choose not to sell to end-users because they don’t want to have customer service, or return policies, so there are some business decisions that come along with deciding who and how to sell product. But usually at the end of the day what refurbishers are trying to do is fulfill the needs of their customer. And they do that within their network.”
Refurbishers buying and selling to each other is so prevalent within the industry that often times refurbishers will act as bulk wholesale brokers of equipment to other refurbishers they normally compete with.
Reselling consumer electronics to end-users
Reselling refurbished devices to end-users isn’t always about setting up an Amazon FBA account or reselling through NewEgg or eBay to sell individual or small amounts of items to consumers. Rather, selling to end-users could mean selling to businesses or schools in large quantities.
Sometimes refurbishers get requests from end-users. Take for example a refurbisher who was looking for 200 desktops. His end-user was a school that was required to have all the same make and model of computers for the students. To be cost-effective, the refurbisher needed an older generation of computer, and the only way he could purchase that many of the same computer was through the secondary refurbished market. So, that refurbisher had to go out and find all of these computers, make sure the specs on each computer were correct, and then image them so he could provide them to the school. The point of that story is, when you’re a refurbisher, your customer might not always be someone looking for a single cheap computer; sometimes you are doing good things for the community by working with a school (or simply fulfilling a custom order).
The difference between repair and refurbish
When talking to a refurbisher, the term repair is usually in regards to cell phones and tablets. For these smaller devices, the work is more complex. For example, phones and tablets could have screws that need to be replaced, or parts are glued into them and need to be removed and fixed; basically, when the hardware needs to be fixed, it’s considered repair work.
The term refurbish is more about computers and laptops that usually require work with the OS. Computers and laptops are easy to take apart, and the parts can be interchangeable, which isn’t considered difficult work, so the real expertise is installing the software onto the system.
Learning about operating systems
When you work as a refurbisher, one of the most important aspects is learning how operating systems work. And, of course, Microsoft and Apple computers are different enough to warrant their own sections. Microsoft even has rules for their OS and how licenses can be transferred from machine to machine.
Knowing your OS options for refurbished computers
When a refurbisher is sourcing his product, meaning, he is looking for inventory to buy, refurbish, and then resell, they have to be cognizant of what they are buying and the state of the OS on the machines. This is especially true if he is buying product off Amazon, or eBay, or even B-Stock. Buyers should always carefully read product descriptions and know what they are buying before making any bulk purchase.
Basically, secondary market computers will come in one of three ways:
The computer is completely wiped with no OS at all.
The computer has an old OS. If the OS is Windows 8 or lower, then Microsoft might consider that ‘pirated’ software. Mostly, that’s because MS doesn’t support those older operating systems anymore, which means they don’t allow such old computers to be put into the market by their partners.
If you want to buy a refurbished computer that has a legitimate OS, then you can buy a Linux system, which is open source, or you can buy something produced from an MS refurbisher (more on that in the next section). If you buy through an MS refurbisher, that will ensure that you’ll get a genuine license from Microsoft, which means updates will be pushed and MS will offer support for the computer.
Having a legitimate OS is a big deal when you’re talking about the refurbished computer world.
How Microsoft handles licenses for refurbished computers
Microsoft has two refurbishment programs: one is called the Microsoft Registered Refurbisher program and the other is the Microsoft Authorized Refurbishers program. The registered program has thousands of registered refurbishers around the world while there are dozens of Microsoft Authorized Refurbishers—they refurbish tens of thousands of computers a year.
A Microsoft Authorized Refurbisher is a company taking part in the official Microsoft program for licensing Windows and other software on refurbished computers.
Per Microsoft, “The Microsoft Registered Refurbisher program is for small and midsize refurbishers across the globe who want to supply refurbished PCs preinstalled with genuine Microsoft software to local consumers and businesses, as well as qualified charitable organizations, academic users, and specially approved recipients. The program makes available Windows and Office for refurbished devices.”
Both of these MS programs give refurbishers access to discounted legal licensing in order to put a new OS on old equipment. They can basically buy Windows 10 at a discounted rate and then install it on an old piece of equipment.
Apple OS is a bit different
Apple is different in a couple ways from MS because its OS is free. If you have Apple’s equipment, you can download its OS as long as your hardware is compatible with what the OS requires. The caveat to Apple’s OS is that if you have an older Mac without enough RAM, or it has the wrong processor, then it’s (nearly) impossible to update that computer.
Learning R2 Requirements for reselling
R2 is the responsible recycling standard for electronics and it contains a series of requirements for reselling on the secondary market. R2 Requirement #6 deals with Reuse, as in, reuse all products first and if you can’t then you need to recycle responsibly.
R2 Requirement #6 outlines criteria and specific naming of how and what needs to be done by recyclers and refurbishers when operating through the secondary market. The next series of sections provide a description of the three ways to test reusable equipment: Ready for Reuse; Ready for Resale; and Ready for Repair.
Ready for Reuse
Ready for Reuse primarily relates to computers that are ready to be sold to end-users. In this case, a series of requirements have to be met. These requirements include:
Computer has full functionality
Computer has legally licensed software installed (see above about operating systems)
Computer passes a number of different tests, and those records have to be maintained
Computer is clean of any major defects
A Quality Assurance plan is in place
A product returns plan is in place
The product meets the requirements of the recipient
In regards to having a return policy, each refurbisher can create his own, you don’t have to follow Amazon’s 90-day return policy for example, you just need to have one in place. Some refurbishers even offer as long as three to five years to return a purchase.
Honesty and integrity go a long way in a community that runs on networking and word-of-mouth advertising. When reselling refurbished computers, always be upfront about what exactly is included with the purchase.
Ready for Resale
Ready for Resale includes tested products that you know are in good shape. These products also require a quality assurance plan, a product policy, and a return plan like Ready for Reuse, but the big difference is that Ready for Resale includes products where something might not work properly, or there might be some cosmetic defects. In those cases, those defects need to be disclosed in writing. Ultimately, for Ready for Resale, you know the product works but there’s something obviously wrong with it, like it might have a big scratch across it or the USB port doesn’t work. A computer like that as a whole can still be used, but those defects have to be disclosed in writing so that the end-user knows what they are buying. Again, it’s all about being honest with your business.
Ready for Resale products are generally sold in bulk from one refurbisher to another. This happens when a refurbisher does some basic testing and they find something wrong but they don’t have the time or capacity to fix it. In those cases, they will sell to another refurbisher who fully realizes there is more work that needs to be done before it can be sold to an end-user (ready for resale could also be sold to a savvy end-user who knows what they are getting and how to install their own OS, or they don’t mind a scratch or two and can do some of the repairs themselves.
It’s good to remember that selling refurbished consumer electronics is about the needs of the end-user, so, if I’m a refurbisher and I have a customer that needs, for example, 200 desktops, then I have to go out and find 200 desktops of the same make and model. Through networking, I might find another refurbisher who has the correct 200 desktops, but each machine needs a new hard drive, for example. In that case, I’ll buy the 200 desktops as Ready for Resale, replace the hard drives, image them, and then resell to the end-user as Ready for Reuse.
Ready for Repair
The R2 Standard is not only for the repair/refurbish side, it’s for recyclers as well. What Ready for Repair does is allow recyclers to 1. Save equipment from being shredded and going into a landfill; and 2. They can make a profit from selling refurbishable equipment to a refurbisher who will refurbish it (say that 10x fast).
Ready for Repair is geared toward recyclers who might get a product that she knows is refurbishable, but she doesn’t have the capacity to refurbish the product herself. In that case, she can sell or send the computers to a refurbisher who will do the work. Ready for Repair is favorable over considering a product is ready for material recovery. Material recovery is when a recycler pulls out all the precious metals from an electronic device. This includes gold, silver, copper, etc. When the materials are pulled out of a device, that’s considered recycling. The next section discusses recycling in more detail.
Learning R2 Requirements for recycling
Provision 5 of the R2 Standard is managing your downstream and your focus materials—focus materials include PCBs, mercury, CRT glass, batteries, and circuit boards. Circuit boards and batteries are the most common focus materials in today’s electronics, because, really, if you think about it, anything electronic has a circuit board in it. Your keyboard has one, your mouse has one, even wired devices have circuit boards in them. That’s why R2 is so important to follow and to make sure everything winds up in the right place. You want to make sure that you can follow the product until end-of-life to ensure the focus materials are being handled properly so they don’t end up in landfills or places they shouldn’t be.
On the flip side to recycling, there are products that are still valuable, like that unused iPhone 6 or 7 that is sitting in your nightstand or kitchen junk drawer. Products like that can be resold for a profit. For businesses with large quantities of older phones that need to be updated, an ITAD company (a company that manages unwanted equipment for a business) can help. ITAD is about taking assets out of companies, that are usually three to five years old, and reselling those in order to recover the costs, but mostly those are being sold for reuse purposes (to extend the life of the product and to keep them out of landfills). An ITAD may refurbish the older equipment or sell it Ready for Resale and then profit share with the company who wanted to get rid of it, minus the handling costs, etc.
Advocating for end-users
As you’ve discovered, being a refurbisher means wearing many different hats. Refurbishers do a lot more than just replace a hard drive or install a legitimate OS or fix a cracked screen. It also extends past the networking that is required to find new inventory or offload existing inventory. Being a refurbisher also means being an advocate for your end-user, especially if that end-user happens to be someone’s grandma, or if it’s the principal of a school looking for computers. For example, let’s say a customer calls you up and explains they are looking for a refurbished tablet so that grandma can scroll through Facebook and see pictures of the grandkids. A responsible refurbisher might ask if a tablet is the appropriate form factor for a senior, will she be able to read the screen, does she need a bigger screen, will she need a keyboard for typing? It might be better for grandma to have a refurbed laptop instead of a tablet.
It’s important for refurbishers to think about their customer, the end-user, and what and how they are going to use your product. This type of information can help you advise them on the appropriate tool for the job, so to speak.
One of the biggest issues with end-users is over buying. Not in the sense of over buying in quantity (like you bought 20 computers when you needed 2), but in the sense of over buying on the specs. Does your 5th grader really need a computer with 2 TB of storage? Are they storing videos and pictures or are they just researching and learning how to type? If so, they might need that extra storage, but the modern user saves their images in the cloud, so you could save your customer a bit of money and not include that extra TB of storage on a PC.
Advising the right specs to satisfy your customer’s needs is important in keeping costs down. Your customers will appreciate the savings and will become a repeat customer and will provide good word-of-mouth advertising for your business.